United States Court of Appeals,
Fifth Circuit.
No. 93-5426.
LOUISIANA INSURANCE GUARANTY ASSOCIATION, Petitioner,
v.
Neil ABBOTT, Jr., and Director, Office of Workers' Compensation
Programs, U.S. Department of Labor, Respondents.
Dec. 20, 1994.
Petition for Review of a Decision of the Benefits Review Board.
Before WHITE, Associate Justice (Ret.),* BARKSDALE and PARKER,
Circuit Judges.
WHITE, Associate Justice (Ret.).
Appellant challenges certain portions of a decision of the
United States Department of Labor Benefits Review Board (the
"Board") awarding benefits to appellee under the Longshore and
Harbor Workers' Compensation Act (the "Act"), 33 U.S.C. § 901 et
seq. Specifically, appellant contends that the Board erred in
affirming the findings of the administrative law judge (the "ALJ")
on three points: the date of appellee's "maximum medical
improvement," the availability of permanent total disability
benefits during the period of appellee's vocational rehabilitation,
and the calculation of appellee's post-retraining wage earning
capacity. This court's review of Board decisions is limited to
considering whether the Board "correctly concluded that the ALJ's
order was supported by substantial evidence on the record as a
*
The Honorable Byron R. White, Associate Justice of the
United States Supreme Court, (Ret.), sitting by designation,
pursuant to 28 U.S.C. § 294(a).
1
whole and is in accordance with the law." Avondale Industries,
Inc. v. Director OWCP, 977 F.2d 186, 189 (5th Cir.1992). Because
we conclude that the Board's appraisal of the ALJ's careful
decision was correct on each of the points outlined above, we
affirm.
I.
On January 11, 1983, Neil Abbott, Jr., the appellee, injured
his back while hanging tires, to be used as bumpers, around a
vessel at the Universal Iron Works facility in Houma, Louisiana.
Universal employed Abbott as a welder. Shortly after the injury,
Abbott was diagnosed as having a herniated disc; he received
treatment from an orthopedic specialist until April 1984, when he
was released for return to work under significant restrictions.
Because of the nature of his back injury, Abbott was unable to
return to his previous, physically demanding job with Universal;
the doctor recommended that Abbott seek vocational rehabilitation
so that he could change to a more sedentary form of employment.
Following his medical release, Abbott sought vocational
counseling through the Department of Labor and was referred to
Jennifer Palmer, a licensed vocational rehabilitation specialist.
Palmer believed that Abbott was a good candidate for vocational
retraining rather than simple placement in an unskilled,
minimum-wage job; she therefore designed a rehabilitation and
retraining program that would allow Abbott to earn a salary equal
to—if not greater than—that which he had earned as a welder with
Universal. Accordingly, in the fall of 1985, Abbott began a
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four-year college program in medical technology at Nicholls State
University in Lafayette, Louisiana. The Department of Labor paid
Abbott's tuition and required him to attend school full-time
throughout the year. Abbott also was required to maintain a
certain minimum grade point average. Palmer believed that school
and family pressures would have precluded Abbott from working, even
on a part-time basis, had the Department of Labor allowed him to do
so. Abbott completed his program, plus a one-year internship, on
July 25, 1990; he began working as a medical technician the
following month at Southern Louisiana Medical Center, a public
hospital.
From the time of the accident until September 15, 1986, Abbott
received voluntary worker's compensation payments from Universal's
insurer or from Universal itself. These voluntary benefits were
paid—and ended—while Abbott was enrolled in the retraining program
at Nicholls State. Both Universal and its insurer apparently were
aware of Abbott's rehabilitation program while they made the
compensation payments, and neither objected. After September 15,
because of the insolvency of Universal and its insurer, Abbott
sought compensation benefits under the Longshore and Harbor
Workers' Compensation Act from appellant, Louisiana Insurance
Guaranty Association ("LIGA"), a non-profit, unincorporated entity
created by the Louisiana legislature to pay claims when the primary
insurer is insolvent. See LSA-R.S. 22:1375 et seq.
In July 1988, an administrative law judge issued an order
requiring LIGA to pay Abbott benefits for his continuing temporary
3
total disability. The Board initially affirmed the ALJ's decision
in all respects. Abbott v. Universal Iron Works, Inc., 23 BRBS 196
(1990). On reconsideration, however, the Board remanded for a new
hearing on Abbott's entitlement to benefits under the Act because
LIGA had never been given the opportunity to contest the nature and
extent of Abbott's disability.1 Abbott v. Universal Iron Works,
Inc., 24 BRBS 169 (1991).
On remand, the ALJ found that Abbott had reached maximum
medical improvement on April 18, 1984, and determined that Abbott
was entitled to compensation for temporary total disability2 until
he completed vocational retraining on July 25, 1990, and to
permanent partial disability compensation thereafter. LIGA
appealed the ALJ's decision, and the Board affirmed in all relevant
respects. Abbott v. Louisiana Ins. Guaranty Ass'n, 27 BRBS 192
(1993). We are now asked to review three aspects of the Board's
decision, all of which concern the amount of benefits to which
Abbott is entitled and not LIGA's liability therefor. We discuss
1
The Board denied LIGA's petition for a stay of compensation
benefits while the appeal was being considered, an action that
was sustained in the courts. In re Compensation Under Longshore
& Harbor Workers' Compensation Act, 889 F.2d 626 (5th Cir.1989),
cert. denied sub nom. Louisiana Ins. Guaranty Ass'n v. Abbott,
494 U.S. 1082, 110 S.Ct. 1813, 108 L.Ed.2d 944 (1990). The
issues presented in that earlier appeal are not relevant here.
2
As the Board later noted, the ALJ erred in characterizing
Abbott's total disability as temporary during the period of
rehabilitation, which occurred after he reached maximum medical
improvement. As we discuss infra, part II.A., the nature of a
claimant's disability is permanent once the claimant reaches
maximum medical improvement, regardless of whether the extent of
that disability is total or partial. The Board corrected the
ALJ's error in terminology on appeal.
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each in turn.
II.
A.
A claimant is considered permanently disabled under the Act
if he or she has any residual disability after reaching maximum
medical improvement, the date of which is to be determined solely
by medical evidence and is not dependent on economic factors. See
Trask v. Lockheed Shipbuilding & Construction Co., 17 BRBS 56, 60-
61 (1985). LIGA argues that the ALJ erred in concluding that
Abbott did not reach maximum medical improvement until April 18,
1984, because Abbott's treating physician testified in a deposition
that Abbott's physical condition had reached a "plateau" in August
1983. In finding April 18, 1984, to be the relevant date, the ALJ
considered the doctor's estimation to have been a retrospective
characterization. That is, the physician was saying only that,
after the fact, it became clear that Abbott made no significant
improvement after August 1983. The ALJ reasoned, however, that the
later date represented the point of maximum medical improvement
because the doctor continued to treat and evaluate Abbott between
August 1983 and April 1984; it was only then that the doctor
concluded that nothing further could be done for Abbott. The Board
affirmed the ALJ's decision on this point; and LIGA apparently
believes that the Board's holding delayed the point at which LIGA's
compensation payments to Abbott could potentially be reduced for
approximately eight months.
The Act provides coverage for four different categories of
5
disabilities: permanent total disability, temporary total
disability, permanent partial disability, and temporary partial
disability. 33 U.S.C. § 908. Thus, "[t]his statutory structure
indicates two independent areas of analysis—nature (or duration) of
disability and degree of disability." Stevens v. Director, OWCP,
909 F.2d 1256, 1259 (9th Cir.1990), cert. denied, 498 U.S. 1073,
111 S.Ct. 798, 112 L.Ed.2d 860 (1991). The Act does not define
those terms, and hence the courts have been left to enunciate
standards for distinguishing between the various categories. New
Orleans (Gulfwide) Stevedores v. Turner, 661 F.2d 1031, 1037 (5th
Cir.1981). The statutory scheme does provide, however, for
different amounts of compensation based on extent and permanence of
a worker's disability.
The point of maximum medical improvement represents the
beginning of permanent, as opposed to temporary, disability under
the statutory scheme. This court has stated that an employee is
permanently disabled when "his condition has continued for a
lengthy period, and it appears to be of lasting or indefinite
duration, as distinguished from one in which recovery merely awaits
a normal healing period." Watson v. Gulf Stevedore Corp., 400 F.2d
649, 654 (5th Cir.1968), cert. denied, 394 U.S. 976, 89 S.Ct. 1471,
22 L.Ed.2d 755 (1969). A claimant is thus entitled to temporary
disability payments until he or she has attained what courts and
the Board have termed the point of maximum medical improvement.
The federal courts have provided various definitions of this point,
all of which amount to the same concept. See, e.g., Palombo v.
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Director, OWCP, 937 F.2d 70, 76 (2d Cir.1991) (viewing the date of
maximum medical improvement as "the point when the injury has
healed to the full extent possible"); Director, OWCP v.
Berkstresser, 921 F.2d 306, 312 (D.C.Cir.1990) (defining maximum
medical improvement as "the time at which no further medical
improvement is possible"); Stevens, 909 F.2d at 1257 (explaining
that "[m]aximum medical improvement is attained when the injury has
healed to the full extent possible"). Once an injury becomes
permanent, an employee becomes eligible for federally-sponsored
vocational rehabilitation programs, see 33 U.S.C. § 939(c)(2), and
an employer becomes entitled to relief from compensation liability
under certain conditions, see 33 U.S.C. § 908(f). An earlier date
of maximum medical improvement is therefore likely to reduce an
employer's overall compensation liability.
In this case, the Board held that a condition becomes
permanent when the employee is no longer undergoing treatment with
a view towards improving his condition. See also Brown v. Lykes
Bros. Steamship Co., 6 BRBS 244, 247 (1977) (noting that even where
subsequent treatment does not improve a claimant's condition, the
claimant may not reach maximum medical improvement until medical
opinion establishes that the treatment was not successful and
further treatment would not improve the claimant's condition). The
Board's position is entirely consistent with this court's
precedent. If a physician determines that further treatment should
be undertaken, then a possibility of success presumably exists.
One cannot say that a patient has reached the point at which no
7
further medical improvement is possible until such treatment has
been completed—even if, in retrospect, it turns out not to have
been effective. Here, the physician clearly believed until April
1984 that further treatment could be productive. Although LIGA
contends that the doctor impermissibly took into account the fact
that Abbott had not completed a vocational evaluation in the summer
of 1983, the Board found that the ALJ's findings were still
adequately supported when only medical, and not vocational, factors
are considered. Accordingly, we hold that the Board was correct in
affirming the ALJ's determination of Abbott's date of maximum
medical improvement as rational and supported by substantial
evidence in the record.
B.
Whereas maximum medical improvement is the indication of
permanent versus temporary disability, the availability of suitable
alternative employment distinguishes partial from total disability.
See Stevens, 909 F.2d at 1259. Thus, the degree of a claimant's
disability is not determined solely by reference to medical
information. The Act defines the term "disability" as the
"incapacity because of injury to earn the wages which the employee
was receiving at the time of injury in the same or other
employment." 33 U.S.C. § 902(10). Because the statute frames the
definition in terms of the worker's lost wage-earning capacity,
courts have generally viewed disability principally in economic
terms. Turner, 661 F.2d at 1037-38. See also Bumble Bee Seafoods
v. Director, OWCP, 629 F.2d 1327, 1328 (9th Cir.1980) ("The degree
8
of physical impairment is measured by its impact on the worker's
earning capacity."). As this court has stated, "[i]t is therefore
possible under [the Act] for an individual to be totally disabled
"when physically capable of performing certain work but otherwise
unable to secure that particular kind of work.' " Turner, 661 F.2d
at 1038 (quoting Diamond M. Drilling Co. v. Marshall, 577 F.2d
1003, 1006 (5th Cir.1978)).
In this case, the ALJ awarded total disability compensation
from the date of maximum medical improvement until Abbott completed
his vocational rehabilitation program. LIGA's vocational expert
testified that, during this entire period, Abbott had a
minimum-wage residual earning capacity (i.e., he was physically
capable of performing any number of available minimum-wage jobs).
Thus, LIGA argues, Abbott was only partially disabled within the
meaning of the Act while he was completing his job retraining
program. Abbott contends, on the other hand, that it was
appropriate for the ALJ to treat him as totally disabled during
this time because (1) he returned to school as part of a Department
of Labor-sponsored retraining program that was carefully planned
and was agreed to by both his former employer and its insurance
carrier, (2) even part-time work would have disqualified him from
receiving the federal tuition payments that allowed him to complete
the program, and (3) evidence in the record revealed that he would
have been unable to maintain the required minimum grade point
average while working. This case therefore cleanly presents a
question of first impression in this circuit, as it was for the
9
Board: may an injured worker continue to receive permanent total
disability benefits while undergoing vocational rehabilitation if,
but for the requirements of the retraining program, the individual
would be able to take a minimum wage job? The Board affirmed the
ALJ's decision, noting that "while claimant was capable of
performing jobs employer's expert identified as available, he could
not realistically secure that particular employment due to his
participation in his Department of Labor-approved rehabilitation
plan."
As this court explained in Turner, once a claimant
demonstrates that he is unable to perform his former longshore
employment tasks because of a job-related injury, he has made a
prima facie case of total disability. The burden then shifts to
the employer, should it wish to reduce or eliminate its
compensation liability, to establish that the employee is capable
of performing other realistically available jobs. Turner, 661 F.2d
at 1038; see also P & M Crane Co. v. Hayes, 930 F.2d 424, 429-30
(5th Cir.1991). The Turner court developed a two-pronged test by
which employers can satisfy this alternate-employment burden.
Courts should consider (1) what types of jobs the claimant is
capable of performing or capable of being trained to do, and (2)
whether there are jobs reasonably available in the community for
which the claimant is able to compete and which he could
realistically and likely secure. Turner, 661 F.2d at 1042. The
Turner court acknowledged, however, that the Act provides no
standard for determining the extent of disability, see also Roger's
10
Terminal & Shipping Corp. v. Director, OWCP, 784 F.2d 687, 690 (5th
Cir.1986), cert. denied, 479 U.S. 826, 107 S.Ct. 101, 93 L.Ed.2d 51
(1986), and that disability under the Act is determined "not only
on the basis of physical condition but also on factors such as age,
education, employment history, rehabilitative potential, and the
availability of work that the claimant can do." Turner, 661 F.2d
at 1038.
The Act does not explicitly provide for the result chosen by
the ALJ and approved by the Board in this case, but the decision
below is consistent with this court's analysis in Turner, as well
as with the Act's goal of promoting the rehabilitation of injured
employees to enable them to resume their places, to the greatest
extent possible, as productive members of the work force. See
Palombo, 937 F.2d at 74; Stevens, 909 F.2d at 1260. Moreover, the
Supreme Court has held that the Act should be "liberally construed
in conformance with its purpose, and in a way which avoids harsh
and incongruous results." Director, OWCP v. Perini N. River
Assocs., 459 U.S. 297, 315-16, 103 S.Ct. 634, 646, 74 L.Ed.2d 465
(1983). We conclude that the Department of Labor's restrictions on
outside employment rendered the minimum wage jobs "unavailable"
within the meaning of the Act and Fifth Circuit precedent. While
Abbott was physically capable of performing the minimum-wage jobs
LIGA's expert identified as having been available, he could not
reasonably secure that employment under the statutory scheme
because his participation in his rehabilitation plan approved by
the Department of Labor precluded him from working.
11
Furthermore, the ALJ found, Abbott increased his earning power
well above the minimum-wage level by completing his vocational
retraining, thereby reducing LIGA's long-term compensation
liability. LIGA now argues, after the fact, that Abbott should
have been required to take a minimum-wage job instead (or, at
least, that its compensation obligation should be limited as if he
had taken such a job, regardless of whether he did or not). Such
a result would be inconsistent with the flexible inquiry outlined
in Turner.
The Board and the ALJ also noted that the rehabilitation
program developed for Abbott in this case was consistent with the
Act and the Department of Labor's regulations. The Act provides
that "[t]he Secretary shall direct the vocational rehabilitation of
permanently disabled employees." 33 U.S.C. § 939(c)(2). The
Secretary is authorized to promulgate such rules and regulations as
are necessary to administer the statute, 33 U.S.C. § 939(a), and
the Department of Labor has done so regarding vocational
rehabilitation, see 20 C.F.R. §§ 702.501-702.508. The regulations
provide that "[t]he objective of vocational rehabilitation is the
return of permanently disabled persons to gainful employment
commensurate with their physical or mental impairments ... through
a program of reevaluation or redirection of their abilities, or
retraining in another occupation...." § 702.501. Vocational
advisers are to construct training programs "in anticipation of a
short, realistic, attainable vocational objective terminating in
remunerable employment, and in restoring wage-earning capacity or
12
increasing it materially." § 702.506. The regulations give the
advisers significant flexibility in devising such training
programs: they "shall be developed to meet the varying needs of
eligible beneficiaries, and may include courses at colleges...."
§ 702.506(b).
In retrospect, it may be that Abbott's vocational counselor
could have devised a shorter rehabilitation program for Abbott. We
agree, however, that the program chosen was reasonable, and that,
contrary to LIGA's assertion, that plan was not blindly or rigidly
adhered to by either the counselor or the administrative review
panels below. In light of the limited standard of review, the
Board's decision must be affirmed. It would be "unduly "harsh and
incongruous' to find that suitable alternative employment was
reasonably available if the claimant demonstrates that, through his
own diligent efforts" at rehabilitation, he was ineligible for such
a job. Palombo, 937 F.2d at 73 (affording claimant an opportunity
to prevail by showing he diligently sought but was unable to secure
a job because that result is consistent with the remedial goals of
the Act). The Act gives the Department of Labor the authority to
direct rehabilitation programs; courts should not frustrate those
efforts when they are reasonable and result in lower total
compensation liability for the employer and its insurers in the
long run.
C.
Finally, LIGA asserts that the ALJ erred in calculating
Abbott's post-retraining residual wage-earning capacity (from the
13
time he completed his rehabilitation program and began working as
a medical technician at the Southern Louisiana Medical Center).
The ALJ determined that Abbott was entitled to permanent partial
disability compensation commencing in July 1990 and measured as the
difference between his average weekly earnings as a welder at the
time of his accident in January 1983 and the wages available to a
medical technician in the area at that time. In calculating the
latter figure, the judge relied upon an average between the wage
earned by such technicians in private and public hospitals in
Abbott's area, and the Board approved that calculation. LIGA
contends that the ALJ should have used the higher, private-industry
figure because the evidence suggests that Abbott could have
obtained a private sector job as a medical technician at Terrebonne
General Hospital or Lakewood Hospital.
The parties agree that Abbott was entitled to permanent
partial disability benefits after he completed the vocational
rehabilitation program and began work as a medical technician. The
statute provides that "the compensation shall be 662/3 per centum
of the difference between the average weekly wages of the employee
[before the accident] and the employee's wage-earning capacity
thereafter in the same employment or otherwise, payable during the
continuance of partial disability." 33 U.S.C. § 908(c)(21). The
wage-earning capacity of an injured employee in cases of partial
disability, in turn, "shall be determined by his actual earnings if
such actual earnings fairly and reasonably represent his
wage-earning capacity: Provided, however, that if the employee['s]
14
... actual earnings do not fairly and reasonably represent his
wage-earning capacity, the [ALJ] may, in the interest of justice,
fix such wage-earning capacity as shall be reasonable...." §
908(h). The statute thus permits the factfinder significant
discretion in fashioning a reasonable post-injury wage-earning
capacity for the injured worker. See, e.g., Penrod Drilling Co. v.
Johnson, 905 F.2d 84, 87 (5th Cir.1990) (describing method of
calculating award for permanent partial disability); Randall v.
Comfort Control, Inc., 725 F.2d 791, 795 (D.C.Cir.1984).
Here, the ALJ calculated Abbott's wage-earning capacity by
averaging the wages a medical technician would have earned at the
area's higher-paying private hospital with those of the
lower-paying, publicly-funded hospital where Abbott was actually
employed. The ALJ therefore recognized that Abbott's actual income
did not fairly represent his wage-earning capacity for the period
after his vocational retraining; the judge then attempted to
calculate the relevant wage in the market as a whole. The record
shows that Abbott applied for a job at Terrebonne Hospital upon
completion of his medical technician degree but was not accepted.
Later, Abbott was contacted twice by Terrebonne with regard to
employment, but he declined to pursue the opportunities, noting
that he was content with his job at the public hospital because of
its proximity to his house and because he was not required to work
on weekends. Taking these facts into account, the ALJ determined
that averaging the two salary figures would provide a fair and
appropriate measure of what a trained medical technician would have
15
earned in 1983.
The Board concluded on appeal that the ALJ's determination was
supported by substantial evidence, and our review of the record
reveals no reason to disagree. The ALJ's compensation order fixed
a residual wage-earning capacity that is clearly reasonable within
the meaning of the Act, and it compensates Abbott appropriately for
his permanent partial disability.
III.
Because it correctly concluded that the ALJ's compensation
order was supported by substantial evidence on the record as a
whole, and that it was in accordance with the law, the decision of
the Benefits Review Board is
Affirmed.
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